Federal shutdown starts affecting America beyond government workers

Thursday , March 06, 2014 - 2:00 PM

Holly Yeager, Marc Fisher, The Washington Post

The reality of the government shutdown is finally hitting Americans who don’t get their paychecks from Uncle Sam.

In Pittsburgh, Tim Russell was on the cusp of living his dream: After two years of work, after lining up federal and state licenses and buying equipment to make rum, he started making his first batch last week. Then the federal Alcohol and Tobacco Tax and Trade Bureau closed shop. With no one to approve the “Maggie’s Farm Rum” labels, Russell can’t sell a drop.

On Alaska’s Upper Kenai River, the silver salmon and rainbow trout are huge and plentiful, but Fred Telleen’s fly-fishing guide service this week has been reduced to processing cancellations and refunds, because the Kenai National Wildlife Refuge is closed. Telleen lost $1,100 on Monday alone.

In Bridgeport, Conn., Renate Seymour, an office manager at a factory, suddenly had to make alternative arrangements for her 4-year-old grandson, Jeremiah, who can no longer attend Head Start because classes shut down when the government closed up.

But wait: The pain of a shutdown is also eluding many millions of Americans.

Orange cones still dot plenty of federally funded highway projects, keeping an estimated 783,000 construction workers on the job. That’s because the way road financing works, states usually pay the upfront costs, then bill Washington for reimbursement. And the Highway Trust Fund, funded by the federal gas tax, has money to make these payments.

Thousands of federal meat and poultry inspectors are still monitoring slaughterhouses and packing plants, which can’t sell meat without the government’s stamp of approval. The Agriculture Department told field inspectors to stay on the job “to ensure the safety of human life for the duration of a government shutdown.”

In Mesquite, Nev., Police Chief Troy Tanner has seen no blip in crime, no signs of strain, no sense of a nation in distress. True, he has found himself pumping out more emails and phone calls than usual to figure out which of his federal counterparts are working — no answer at the nearest Bureau of Alcohol, Tobacco, Firearms and Explosives office, but the FBI guy is there, he says.

But in his town of 16,000 near the borders with Utah and Arizona, the only frustration Tanner senses has come from one of his captains, who had just arrived in Virginia for a 10-week FBI National Academy course on the day before the government closed, only to be told that he had to turn right back around because the shutdown forced the cancellation of classes.

“What a waste of time,” the chief said. “He’s disappointed.” There is one silver lining, though: When the airline charged the captain an exorbitant last-minute airfare to get back home, the feds picked up the tab, Tanner said. Thank you, Uncle Sam.

The federal government has become the behemoth that cried wolf. For more than two decades, budget brinkmanship has been such a mainstay of Washington politics that many Americans long ago grew skeptical of claims that if one deal or another weren’t made, the Statue of Liberty would close or the nation’s highways would seize up in the mother of all gridlocks.

Republicans in Washington expressed hope that a shutdown would cause enough disarray to force President Barack Obama and the Democrats to talk about rolling back the administration’s health-care reforms. Democrats in turn raised expectations that a shutdown would hit Americans so severely that they’d demand that Republicans vote to reopen the government.

But the reality is that the government is too large and too complex for something as dramatic as a shutdown to cause anything as dramatic as an actual shutdown. At the peak of this latest closing, 800,000 out of about 1.9 million civilian federal employees were put on ice. Many arms of government still had half, three-quarters or even nine-tenths of their workers coming in every day, despite the closing of the money spigot.

Many services continue apace. Agencies have used reserves, contingency funds and declarations of essential purpose to keep going. Some agencies stay open with money from user fees. Some operate under rules allowing money from a previous year’s budget to be used this year.

The shutdown has created enough confusion around the country that its impact sometimes stretches beyond the actual state of play. The Agriculture Department’s Women, Infants and Children nutrition program, one of the government’s largest food programs, serves low-income mothers and small children and is running using contingency funds and money carried over from last year.

But several WIC administrators across the country report that retailers — usually small bodegas or rural grocers — are refusing to accept food vouchers because they’re worried they’ll turn out to be worthless when they deposit them at the bank.

In California, grocery stores received strong warnings last week that “vendors who do not accept food instruments will be terminated for voluntary cessation of operations.”

Head Start programs in several states shut their doors last week, leaving about 7,000 children without services, according to the National Head Start Association.

When the centers’ annual funding, due Oct. 1, didn’t arrive, one program in central Alabama closed at midnight on Sept. 30, ending preschool for 898 children in six counties and cutting off parents’ access to free day care and social services.

Dora Jones, program director for Cheaha Regional Head Start in Talladega, Ala., and her head custodian spent Friday driving to her 16 centers to make sure doors and windows were locked, appliances unplugged, and air conditioners turned off.

Jones had to furlough more than 200 employees, including Jazmine Myers, 26, who had already been furloughed for two weeks this summer because of budget cuts required by sequestration.

“I basically just stay at home with my son,” a 2-year old who usually attends one of the shuttered centers, she said. “I don’t have money for gas, so we don’t really go anywhere.” She has applied for food stamps. And last week, she waited on hold for 40 minutes to apply for unemployment benefits before hanging up in frustration.

Those closed Head Start centers should be able to reopen by week’s end thanks to an emergency, $10 million loan by Houston philanthropists Laura and John Arnold.

In the meantime, in Bridgeport, Renate Seymour has realized just how precariously her life is balanced — with support from myriad arms of the government. She’s had the same job for 28 years, but she and her 4-year-old grandson get by with help from Head Start, WIC, public housing, subsidized health insurance for Jeremiah, vouchers for food from the farmers market and federal energy assistance.

At Head Start, Jeremiah, who is developmentally delayed and “has problems adjusting to change,” his grandmother said, the “teachers are specially trained to deal with these types of children.” Head Start provides Jeremiah with breakfast, lunch and snacks, so the shutdown has added to Seymour’s grocery bill. She also gets WIC vouchers, worth about $45 a month, to buy cereal, eggs, vegetables and milk.

“I work for a living,” Seymour said, “but I can’t make it day to day.”

The shutdown’s effects are manifesting farther up the income ladder as well. It could cost Carolyn Barschow Thompson and her husband, Matthew, a two-bedroom Cape Cod on two acres outside Portland, Maine, that they fell in love with in August.

To buy the house, the couple got around their imperfect credit rating with help from a rural development loan guarantee from the Agriculture Department. They signed a contract in late August for less than $200,000, Thompson said, and the house was appraised Tuesday. But their lender told the couple that without the Agriculture Department’s final sign-off, they could lose the house.

The seller has agreed to wait — for a few days. “But they’re not pleased,” said Thompson, 31, a preschool teacher. “We’re so worried that she’s going to put the house back on the market.”

Even when the government reopens, the backlog of accumulated paperwork could delay their closing for weeks. They could apply for a conventional loan with a higher interest rate, but their lender would still need the Internal Revenue Service to verify their income. The workers who process those forms are furloughed.

Thompson was already imagining the garden they would plant and the duck pond out back. “We were finally starting to feel like we were in the clear,” she said.

Wherever government regulation reaches, people are starting to see roadblocks. Russell, the Pittsburgh rum maker, thought he was on his way when he got a shipment of 2,500 pounds of sugar and revved up his still last week.

But until the 500-employee agency tucked within the Treasury Department approves his label, “I can’t make any income, because I can’t sell anything,” said Russell, 31.

The Alcohol and Tobacco Tax and Trade Bureau approves labels for new alcoholic beverages, grants permits for wholesalers and imports, and signs off on new formulas for wines and spirits.

At Lake Effect Brewing in Chicago, owner Clint Bautz has several new beers whose labels and formulas await federal approval. He can still sell his flagship beers and must keep paying the $7-per-barrel federal excise tax. Shutdown or not, the government collects taxes.

Four thousand miles northwest of the District of Columbia, Alaskan fishing guide Fred Telleen has already lost more than $5,000 to the shutdown. Eagles soar from active nests and bears prowl the shores for fish before disappearing into winter hibernation, but Telleen’s Mystic Fishing tour has been barred from the most pristine stretch of the Kenai River.

Telleen, one of only 20 guides with permits to conduct tours of the upper river, had to tell customers that the area is off-limits or he might lose his license to fish the area. His clients said “no thanks” to alternative fishing spots.

“I have some guys right now who traveled all the way from Belgium,” Telleen said. “It’s extremely frustrating.” The fall fishing season normally closes near the end of October, and so it’s now all but ended and people are staying away.

Gregory Bloom is worried about people staying away, too. As president of Seal Science in Irvine, Calif., a small business that works on design and engineering for NASA’s Orion, America’s next manned spacecraft, Bloom is seeing how uncertainty in Washington makes it harder to attract talent.

“Trying to get the best and the brightest to come join a company that specializes in national defense or NASA-supported activities and not being able to tell them that they’re going to have a job in six months is a real tricky challenge for us,” he said.

One senior engineer already left because of the uncertainty, Bloom said: “What keeps coming back to us is ‘why go work in national defense or aerospace when we can go to Google and know that we’re going to have a job?’ “

Similarly, at the Mayo Clinic in Minnesota, Michael Joyner, the former associate dean for research, has a list of researchers who were about to get grants from the National Institutes of Health but now have been left in a purgatory that could drive them into careers that don’t rely on uncertain federal funding.

The paralyzed projects include one examining cognitive function in older people and one on why people regain weight after diets or weight-loss surgery.

“Multiply this all over campus and all over the country, and you get the picture,” Joyner said. “If this drags on, you’re going to really gum up the scientific and research apparatus of the country. . . . If this goes on for very much longer, you’re going to have kind of a lost generation of scientists.”

Not much attention is being devoted to such long-term impacts of the shutdown, however, because more immediate effects pop up every day. This weekend’s scheduled semiannual roundup and health check of the Chincoteague ponies, made famous by “Misty of Chincoteague,” the 1947 novel about the Virginia herd, has been canceled because the shutdown closed the wildlife refuge where the 130 ponies live.

The Facebook page of the local fire company that announced the cancellation said it was “due to the childish, idiotic actions of our government.”